Volkswagen reaches settlement with 10 US states on its emissions scandal

Volkswagen reaches settlement with 10 US states on its emissions scandal

The company has agreed to pay out more than $20 billion to avoid criminal charges

The Dollar Business Bureau 

The German automaker Volkswagen has agreed to pay $157.5 million to 10 US states for violating emissions standards. Speaking to the media, a spokesperson of the company said that his company has reached a settlement on Thursday with the representatives of Massachusetts, Virginia, New York and other seven states on this matter avoiding further prolonged and expensive litigation. 

In its press statement, the company said, "The agreement avoids further prolonged and costly litigation as Volkswagen continues to work to earn back the trust of its customers, regulators and the public.” 

So far the company has agreed to pay out more than $20 billion to state and federal authorities, auto dealers and consumers to avoid criminal penalties in its bid to resolve the diesel scandal charges that the company has been facing since 2015. 

During routine checks by regulators, it was discovered that the ‘clean’ cars were emitting 40 times the permissible nitrogen oxide levels when driven but were arranged in such a manner that they remained hidden during testing.

Almost 11 million vehicles sold worldwide had that hidden feature. 

Despite the crisis Volkswagen has seen a strong performance last year, clocking nearly $5.4 bn in profits after a loss of nearly $2 billion in 2015. 

All the 10 states have adopted strict emissions standards emulating the state of California, as it is the country’s biggest auto market and retains the rights to set tough testing standards. Though the Trump administration has vowed to roll back the requirements to increase fuel efficiency set by his predecessor Obama, there has not been any move on that front till date.

Volkswagen is recalling nearly 3.14 lakh cars in India beginning July over the emissions scandal.

The Dollar Business Bureau - Mar 31, 2017 12:00 IST
 
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